Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Health, to which was referred H.B. No. 549 entitled:

begs leave to report as follows:

The purpose of this bill is to improve Hawaii's health by discouraging smoking and the use of tobacco products by increasing the excise tax on cigarettes and tobacco products incrementally beginning after June 30, 2003.

The American Lung Association and Coalition for a Tobacco Free Hawaii testified in support of this measure. The Department of Taxation opposed this measure. The Tax Foundation of Hawaii submitted comments.

Your Committee finds that cigarette price increases reduce smoking, particularly among youth. Furthermore, individuals who do not smoke in their youth are not likely to start smoking as an adult. Your Committee believes that a portion of the increase in the tobacco tax collected should be allocated towards tobacco cessation and substance abuse programs.

Upon further consideration, your Committee has amended this bill by:

As affirmed by the record of votes of the members of your Committee on Health that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 549, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 549, H.D. 1, and be referred to the Committee on Finance.